Opinion Contributor

Government regulations: Rhetoric vs. reality

Regulatory policy is a central issue in the 2012 presidential race, as the Republicans and Democrats stake out their positions.

Republicans blame President Barack Obama and the Democrats for excessive, job-killing regulations, while Democrats warn of the wholesale deregulation of financial and environmental safeguards if Republican presidential nominee Mitt Romney wins.

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But are these caricatures accurate? Not according to government statistics — which show that, except for Ronald Reagan and Obama, Republican and Democratic administrations have issued new regulations at the exact same rate. Nonetheless, the new focus on the effects of regulation suggests that the outcome in November could have a significant effect on the size and reach of the regulatory state. Do Democrats regulate and Republicans deregulate?

The Republican platform declares “government spending and regulation must be reined in,” and calls for “a moratorium on the development of any new major and costly regulations until a Republican administration reviews existing rules to ensure that they have a sound basis in science and will be cost-effective.”

This campaign rhetoric supports what most people think they know: Democrats favor regulation, and Republicans criticize it. Their issuance policies, however, are surprisingly similar, according to government data covering the past 30 years. Presidents George H.W. Bush, Clinton, and George W. Bush, for example, each published an average of 45 major rules a year. (Figure 1 shows the number of final “economically significant” regulations, defined as impacts of $100 million or more per year, published between 1982 and the first half of 2012.) The outliers are Reagan, who issued, on average, a mere 23 major regulations per year; and Obama, who has published 54 per year on average, so far.

In addition, the last real effort at deregulation — aimed at increasing consumer choice, competition and innovation in transportation and telecommunications — occurred in the 1970s and 1980s, starting under Jimmy Carter’s presidency and continuing through Reagan’s. What’s most striking about that “era of deregulation” is its bipartisan support. Major policy shifts — like the elimination of the Civil Aeronautics Board and the Interstate Commerce Commission — proceeded as if the Carter-Reagan transition were not even a speed bump.

Even as “economic regulation” has fallen into well-deserved bipartisan disfavor, “social” regulations — covering health, safety and the environment — increased. Regulatory activity is largely dependent on statutory law and related litigation, leaving presidents with less influence than they might imagine.

One pattern that does follow the presidential electoral cycle is that regulatory activity often peaks in the final year of a president’s term – particularly in the last quarter. This “midnight regulation” phenomenon is evident under both Republicans and Democrats. (visible in Figure 1)

Readers' Comments (10)

Notice how the author, who is surely aware, gives short shrift to Cass Sunstein's efforts to bring cost-benefit analysis to the table in writing regulations and just focuses on the number of regulations instead (which is less at this point in the first term for Obama than for Bush or Clinton). This seems intellectually dishonest to me. The cost-benefit analysis is the right way to do this. If you don't like the methodology for that cba then suggest it. As far as I can tell, aside from a one off complaint about one number, I don't see how Sunstein was wrong. He certainly had both sides complaining so he must have been doing something right.

The problem with the back and forth tit for tat between Obama Democrats and Bush Republicans is that Bush was an indefensible big government guy too... all recent RINO republicans loved big government solutions.

The way these deregulations need to occur is not to tweak them (piling thousands of adjustments on top of bad legislation - trying to fix the foundation by rebalancing the top floor), but to eliminate entire departments wholesale, then consult with industry participants as to what actually makes sense.

OSHA, for example, has many regulations, made by pencil-neck office boys, that actually make the workplace more dangerous.

Most of these issues should be settled at the state level, more sensitive to local conditions. Massive unemployment in Washington DC would be a harbinger of real hope and change.

And of course, the real change needed in America is draconian TORT reform. I won't hold my breath, in as much as both parties slop with those pigs.

Notice how the author, who is surely aware, gives short shrift to Cass Sunstein's efforts to bring cost-benefit analysis to the table in writing regulations and just focuses on the number of regulations instead (which is less at this point in the first term for Obama than for Bush or Clinton).

Hello jhoger, It's been awhile. I hope you are well.

Since the SCOTUS decision on PPACA, there has been a LOT of movement in health care. After 2014, the landscape is going to look a LOT different.

I have been "gaming" since SCOTUS decision and am concluding that:

1) PPACA is not as bad as first thought

2.) It doesn't have nearly the "teeth" I thought it would

3.) There will still be millions of uninsured

4) The system is VERY counter-intuitive and I suspect will need a major overhaul of some serious structural flaws given 3 to 5 years.

I just paid the highest light bill of my life. Not because of regulations. Not because of Cap and Trade.Not because of increased labor costs,BUT BECAUSE OF SMALLER GOVERNMENT. My governor cut the funding for the Consumers Advocacy Agency,which protected comsumers from Corporate gouging at the P.U.C.O. No advocate,no justice.

Susan Dudley, Director of the George Washington University Regulatory Studies Center and author of Regulation: A Primer, writes that if President Obama wins a second term, his pace of new regulations will most likely increase.

The rate of complex, new regulations coming out of Washington is restricting small businesses’ ability to create jobs and help the economy rebound from the financial downturn of the last few years. With fewer resources and tighter profit margins, small businesses have felt the slump of the economy more acutely than most. Yet, Washington bureaucrats continue to demand more from small businesses at a time when they should be focused on recovery and growth. Each year, small businesses create about two-thirds of new jobs and produce half of the country’s GDP. But keeping up with the pace of the federal regulatory process is severely limiting their ability to invest, hire, and grow.

The right policies help businesses operate more efficiently and meet our nation’s regulatory objectives; they don’t impose burdensome red tape that discourages recovery. There are many practical reforms that can be made to help balance the regulatory process. We can all agree we need sensible regulations, but when those rules take us in the wrong direction, it’s important we make practical changes to get back on track.

Susan Dudley, Director of the George Washington University Regulatory Studies Center and author of Regulation: A Primer, writes that if President Obama wins a second term, his pace of new regulations will most likely increase.

The rate of complex, new regulations coming out of Washington is restricting small businesses’ ability to create jobs and help the economy rebound from the financial downturn of the last few years. With fewer resources and tighter profit margins, small businesses have felt the slump of the economy more acutely than most. Yet, Washington bureaucrats continue to demand more from small businesses at a time when they should be focused on recovery and growth. Each year, small businesses create about two-thirds of new jobs and produce half of the country’s GDP. But keeping up with the pace of the federal regulatory process is severely limiting their ability to invest, hire, and grow.

The right policies help businesses operate more efficiently and meet our nation’s regulatory objectives; they don’t impose burdensome red tape that discourages recovery. There are many practical reforms that can be made to help balance the regulatory process. We can all agree we need sensible regulations, but when those rules take us in the wrong direction, it’s important we make practical changes to get back on track.

Susan Dudley, Director of the George Washington University Regulatory Studies Center and author of Regulation: A Primer, writes that if President Obama wins a second term, his pace of new regulations will most likely increase.

The rate of complex, new regulations coming out of Washington is restricting small businesses’ ability to create jobs and help the economy rebound from the financial downturn of the last few years. With fewer resources and tighter profit margins, small businesses have felt the slump of the economy more acutely than most. Yet, Washington bureaucrats continue to demand more from small businesses at a time when they should be focused on recovery and growth. Each year, small businesses create about two-thirds of new jobs and produce half of the country’s GDP. But keeping up with the pace of the federal regulatory process is severely limiting their ability to invest, hire, and grow.

The right policies help businesses operate more efficiently and meet our nation’s regulatory objectives; they don’t impose burdensome red tape that discourages recovery. There are many practical reforms that can be made to help balance the regulatory process. We can all agree we need sensible regulations, but when those rules take us in the wrong direction, it’s important we make practical changes to get back on track.

It’s good to see POLITICO give space to a discussion of the damage being done by President Obama’s regulatory tidal wave. And Susan Dudley of GWU is right to send out a warning signal of how this problem has escalated since 2009. The fact is that, as small business owners know, very few new regulations provide any real benefit. The vast majority of benefits come from a few environmental regs. The Code of Federal Regulations has mushroomed by 11,000 pages and there are 4,100 additional regulations in the federal pipeline now. One can only wonder what the pace will be like if Mr. Obama is successful in winning re-election. We cannot hope for a private sector jobs renaissance if the federal government is strangling job creators with red tape. Putting a focus on the needless and counter-productive growth of federal regulations is important, timely – and appreciated.

The study conducted by Susan Dudley, called “Regulation: A Primer,” does an excellent job to further prove federal over-regulation has occurred during the past four years. Additionally, Dudley specifically points out the tidal wave of pending regulations bottled up in the proverbial pipeline until after the elections, which raises major flags for Florida’s small businesses.